Generic Drug Industry Wins Patent Court Case

The Supreme Court handed generic drug makers a major victory in a patent case Tuesday. Generic manufacturers had been barred from using the courts to challenge patents given to their brand-name rivals. The court ruled unanimously that generics do have that right.

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The Supreme Court yesterday handed a victory to the generic drug industry. In a unanimous decision, the high court said generic drug makers can challenge how the big pharmaceutical companies describe their patents to the Food and Drug Administration.

It sounds like an obscure legal battle, but as NPR's Yuki Noguchi reports, it has potentially big implications for the industry.

YUKI NOGUCHI, BYLINE: There's a diabetes drug approved for three uses. Novo Nordisk has a patent on one of the uses. But to the FDA, the company described its patent broadly, applying it to the other two uses. Generic drug maker Caraco wanted to challenge Novo Nordisk's description. But because the FDA doesn't issue such corrections, Caraco could not make generics for the other, unpatented uses of the drug.

Jeff Kraws is CEO of Crystal Research, an independent research firm. He says this decision is big for a generic drug industry that's $225 billion in size and growing.

JEFF KRAWS: So you've now got a very large market with a potential for smaller companies to go and challenge the 800-pound gorilla.

NOGUCHI: He says companies like Caraco have a new tool for challenging their rivals. But Novo Nordisk General Counsel James Shehan denies this is a blow to big drug brands. He says disputes about patent descriptions are relatively rare.

JAMES SHEHAN: It affects a relatively narrow area of commerce.

NOGUCHI: In a related case, Caraco is disputing the validity of the Novo Nordisk patent.

Yuki Noguchi, NPR News, Washington.

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